Accenture is a familiar competitor in U.S. Government contracting – the company’s work touches a breadth of programs and customers – but how much do we really know about Accenture?
Making a name for itself in the management and IT consulting environment, Accenture is a formidable competitor that plays by its strengths. As we run through the company highlights, you’ll notice that the company has not (yet) competed much outside of their traditional areas of work in the federal contracting market.
Accenture provides management consulting, technology, and outsourcing services with approximately 450,000 employees in offices around the world. In FY2018, the company reported net revenues of approximately $39.6 billion – an increase from the company’s FY2017 net revenue of $34.9 billion. Accenture Federal Services (AFS) is the wholly-owned subsidiary of Accenture that focuses on the U.S. Government. In this blog, we will take a better look at the Accenture Federal Services entity (referred to as simply Accenture going forward).
What does Accenture do?
Accenture organizes itself by customer groups and management segments. Taking a closer look at the management segments, we can see how the company is focusing its efforts. Note that they align marketing and delivery in a customer-centric manner but with these areas of service / solution types.
- Management Consulting—A core part of the Accenture portfolio revolves around providing advisory services to government clients.
- Technology—This increasingly prominent service provides for the development and delivery of technology-related programs, system integration, technology consulting, and application and IT infrastructure support.
- Operations—Accenture’s Operations business provides support to improve customer operations and capabilities through business processing services, modernization, and analysis to improve business and operating models.
- Strategic Solutions and Emerging Technologies—This service supports the development of Accenture’s emerging capabilities and alliances.
- Cyber Strategy—Accenture’s growing cyber practice provides solutions for cyber threats, addressing security concerns for federal customers.
What contracts define the Accenture business?
- Accenture’s largest current contract is the operations and maintenance contract for CMS’s Federally Facilitated Marketplace (FFM). Awarded in 2015, the company has been obligated $576M to date (under a $680M ceiling) for the continued maintenance, support, and software development for HealthCare.gov. This is often viewed as a great success story for Accenture as they took over a struggling program and made it successful.
- Accenture was the original developer for the Department of Education Federal Student Aid (FSA) Common Origination and Disbursement (COD) system, which was completed in 2014. They now support ongoing sustainment and modernization in the $540M COD Federal Financial Aid System follow-on.
- Accenture’s recently expired U.S. Army General Fund Enterprise Business Systems (GFEBS) was the company’s largest contract until the contract ended in July 2018 and Accenture lost the recompete to IBM. With just over $1B in obligations, the company developed the GFEBS suite of financial and procurement management applications.
- Notable newer additions to the Accenture portfolio include the CBP National Recruitment & Hiring contract awarded in November 2017 and the TSA Recruitment and Hiring Services contract awarded in September 2016. These programs have respective ceiling values of $297M ($60M obligated by CBP) and $290M ($42M obligated by the TSA).
Note that the CBP National Recruitment & Hiring contract was terminated in April 2019 for “convenience.” Even though this won’t formally damage their reputation and ability to win future contracts, it certainly does not help them.
The FedSavvy Strategies brief take on Accenture
Expect Accenture to be a capable competitor, especially in their core service lines. The company is looking to make up for lost revenue from recently expired contracts, including the aforementioned U.S. Army GFEBS program in addition to the Defense Logistics Agency (DLA) Enterprise Business Systems (EBS) BPA ($1.5B in obligations, expired vehicle but hanging on with some ongoing task order work).
The company’s recent $501 million UDSA financial services contract win supporting cloud modernization for the U.S. Department of Agriculture’s financial systems is an indication that Accenture can adapt their offerings to a changing IT environment.
Accenture is also actively investing in expanding their cyber business. While they do not yet have a hallmark large cyber contract in their backlog, Accenture certainly has the capabilities and the drive to pursue big cyber work.
We look forward to seeing whether Accenture continues this targeted approach or begins to expand more into other adjacent services in FY 2019.
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